An employee confidence survey has recorded its sharpest fall in four years, but optimists still outnumber pessimists.
The Westpac McDermott Miller employment confidence index fell 4.7 points to 128.8 in the March quarter, its largest fall since the survey began in 2004, but an index above 100 indicates optimists out-numbering pessimists.
Westpac senior economist Donna Purdue said in a statement that employment confidence was coming under pressure from uncertainty about the economic outlook.
"Talk of recession, rising business pessimism and a sharp correction in the housing market, implying a contraction in the residential construction industry, all suggest that the previously incessant demand for labour will moderate.''
Mrs Purdue said compared to the December quarter survey, job security had taken a "thump'', with more respondents believing jobs would be harder to get in a year's time.
"Only a net 11.9% of workers thought their jobs would be more secure over the coming year, almost half that of a year ago.''
Employees' perceptions of current and future earnings also declined in the quarter, but were higher than a year ago, with more than half expecting to be earning more in a year's time.
Waikato was the only region to record a lift in confidence, driven by the high dairy farmer payout.
The index for Otago rose from 132.8 in the March 2007 to 136.9 in December, but fell sharply to 126.2 in the latest survey.
Mrs Purdue said these were testing times for the economy, but it was "reassuring'', that optimistic employees exceeded pessimists.
"Although we are experiencing some of the best economic conditions in a generation, very low unemployment, very strong terms of trade and a strong fiscal balance sheet, we are facing the tightest credit conditions since the mid 1980s, courtesy of the sub-prime crisis that began in the US.
"On top of that, the cost of living is rising sharply and the housing market is undergoing a rapid period of adjustment.''
